Sam Boughedda

Investing.com —Merck & Company Inc (NYSE:) shares edged up 0.4% on Friday after Goldman Sachs analyst Chris Shibutani started coverage of the pharmaceutical company with a conviction buy rating.

An analyst has set a $93 price target for shares. That would indicate a 22% upside over current levels. 

Shibutani stated that while there were a few disappointing updates by the company about molnupiravir’s Covid pill and Merck’s Covid pill as well islatravir (its HIV drug), other assets were valued at an undervalued. 

 “Against a backdrop dominated by the challenge of growing and diversifying revenues beyond the significant success of Keytruda, MRK shares have notably underperformed. However, our analysis on Growth portfolio and pipeline assets has shown that we think the market underestimates the prospects for several assets,” a Goldman analyst wrote in a note. The Goldman analyst pointed out sotatercept and Vaxneuvance as the undervalued assets.

Sotatercept, Merck’s pulmonary hypertension treatment is Vaxneuvance, a vaccine to prevent invasive diseases such as streptococcus pneumonia. Gardasil protects against the effects of Human Papillomavirus.

Shibutani ended by saying that Merck is “capable of pursue significant business development opportunities” and noting the possibility for Merck to sell its Animal Health Business, which Goldman’s considers undervalued.  

Merck, a company that treats adults with renal carcinoma, announced before the bell rang to announce that the European Medicines Agency Committee for Medicinal Products for Human Use has given a positive recommendation for Keytruda.